ZimVie Strikes $375 Million Deal to Sell Spine Business

Shares of ZimVie surged after the medical-technology company announced a lucrative agreement to sell its spine business for $375 million. H.I.G. Capital, an alternative-investment firm, will be acquiring the business.

The stock experienced a remarkable 23% increase in premarket trading, reaching $13.75. It is worth noting that ZimVie's shares had already risen by about 20% earlier this year.

According to the terms of the deal, ZimVie will receive $315 million in cash and an additional $60 million in the form of a promissory note. This promissory note will accumulate interest at a rate of 10% per year, compounded semi-annually, and will be repayable in kind.

The company has outlined its intentions to utilize the funds received to alleviate debt. Vafa Jamali, Chief Executive of ZimVie, also expressed excitement about the deal's potential to enhance the company's dental platform.

"This transaction not only helps us pay down debt but also enables ZimVie to strengthen its dental platform," said Vafa Jamali, President and CEO. He further explained that the deal would create a more focused and streamlined ZimVie, with a prominent position in the thriving global dental markets.

Overall, this agreement provides the necessary capital to fuel future growth in both commercial and innovation platforms within the dental sector while simultaneously reducing ZimVie's leverage profile.